– Deutsche Bank’s Head Of Global Credit Strategy Explains Why “This Is Not Capitalism” (ZeroHedge, May 7, 2015):
When Deutsche Bank’s head of global fundamental credit strategy, Jim Reid, writes a blurb that could have come from any single Zero Hedge article posted here over the past 6 years, it makes us wonder if we, like that Onion, have missed our IPO window.
I don’t think it’s too controversial to say that personally I believe that capitalism is generally the best economic system. However part of the problem today is that over the last 15-20 years, capitalism has been propped up every time it’s about to go through one of the cyclical creative destruction phases.
Compounded up that’s left us with a big mess to clear up across the globe and a lot of sub optimal resource allocation. That’s not the fault of capitalism per se it’s the fault of the authorities for not letting cycles naturally evolve. This has become increasingly more difficult as the imbalances build on top of each other.
So across a lot of the Western World we’re left with too much debt, too much inequality, low real wage growth, limited conventional tools to help the economy to de-lever, QE and ZIRP and a political backlash against the mainstream. Until we find a better solution voters are likely to have a bias to find alternatives whatever the economic literacy of these views.
As long as said alternative don’t involve the war and/or revolution predicted by Paul Tudor Jones of course…